Mattel reports disappointing holiday season

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EL SEGUNDO, Calif. (AP) - Mattel says it was a tough time in toyland this past holiday season.

Shares of Mattel dropped more than 9 percent in premarket trading Thursday after the world's largest toy maker said sales of key toys like Barbie and Fisher-Price preschool items dropped in its fourth quarter.

CEO Bryan Stockton called 2013 a "challenging and transformative year at retail."

Toy makers count on the November and December holiday season to make 40 percent or more of annual revenue. But traditional toy makers are struggling as kids turn more toward electronic devices and video games.

While fourth-quarter net income climbed 21 percent from year-ago results depressed by a litigation charge, Its quarterly performance missed both analysts' estimates and the company's own expectations.

For the three months ended Dec. 31, Mattel Inc. earned $369.2 million, or $1.07 per share. That compares with $306.5 million, or 87 cents per share, a year ago. The prior-year period included an $87.1 million litigation charge.